RALEIGH - United States Attorney Frank D. Whitney announced that STANLEY
H. VAN ETTEN pled guilty in federal court in Raleigh on Friday,
April 29, 2005, to charges related to his misconduct as founder and CEO
of the former International Heritage, Inc. (IHI), a Raleigh-based multilevel
marketing company and for fraud related to Mayflower Venture Capital Fund
III (MAYFLOWER FUND III) and its purported investment in BuildNet, a Durham-based
software company. Under the Plea Agreement filed, STANLEY H. VAN
ETTEN, 44, of Orlando, Florida (formerly of Raleigh), pled guilty
to the following: (1) As to IHI, a count of Conspiracy to Commit Mail
Fraud, Wire Fraud, Securities Fraud, Obstruction of Justice, Subornation
of Perjury, and to Make False Statements to the United States; and (2)
As to Mayflower, a count of Conspiracy to Commit Wire and Mail Fraud.

Related to IHI, VAN ETTEN, three other IHI senior executives,
and the company's outside public accountant were originally indicted by
a federal grand jury on October 16, 2002. (A superseding indictment was
filed on March 20, 2003.) Additionally,VAN ETTEN was
one of four individuals associated with defunct Mayflower Venture Capital
Fund III, a bankrupt $15,000,000 venture capital company indicted by a
federal grand jury in Raleigh on February 17, 2005. (A superseding indictment
was filed on March 17, 2005.)

INTERNATIONAL HERITAGE

The indictment for activities associated with INTERNATIONAL HERITAGE,
INC. resulted from an investigation, by a multi-agency task force coordinated
by the United States Attorney's Office for the Eastern District of North
Carolina.

Originally named in the indictment were STANLEY H. VAN ETTEN,
then of Raleigh, N. C.; CLAUDE WILLIAM SAVAGE, of Charlotte, N. C.; LARRY
G. SMITH, of Greenville, S. C.; JOHN DAVID BROTHERS, of Plano, Texas;
and DAVIN WALTER BROWN, of Raleigh, N. C.

Savage, Brothers, Smith, Brown, and now VAN ETTEN have
entered guilty pleas and are awaiting sentencing.

According to the indictment: INTERNATIONAL HERITAGE, INC. (IHI) was
a corporation formerly located at 2626 Glenwood Avenue, Suite 200, Raleigh,
N. C. VAN ETTEN served as the president and chief executive
officer of IHI. SAVAGE and SMITH were founding directors and leading sales
representatives. BROTHERS was the chief operating officer and compliance
officer. BROWN served as IHI's outside accountant.

In each of its first three years of operation (1995, 1996, and 1997),
IHI derived approximately 90% of its revenue from the recruitment of sales
representatives, who purchased what IHI called "business centers." In
the indictment, IHI and the charged individuals are alleged to have materially
misrepresented the financial condition of IHI in connection with the sale
of corporate notes in 1997.

Specifically, it is alleged that the defendants created a 1.7 million
dollar receivable and added it as an accounting entry retroactive for
the year ending December 31, 1996, in order to create the impression that
IHI had made a profit in the year 1996. The receivable was based on a
so-called "technology fee" assessed to IHI's sales representatives despite
the fact that there was no contractual basis for the fee. Later in 1997,
the 1.7 million dollar receivable was written off by IHI as uncollectible.

From July to October, 1997, IHI made a five million dollar private offering
of unsecured 10% notes convertible to IHI stock in the future. IHI successfully
sold 4.3 million dollars worth of these convertible notes to over 100
private investors. In offering the notes for sale, IHI materially misled
investors, claiming that the company had "achieved profitability" in 1996.
This claim was made despite the fact that IHI had, at the time of the
offering, already written off the 1.7 million dollar receivable from the
"tech fee." IHI also failed to disclose to potential investors that the
company continued to lose large amounts of money during the year 1997,
which eventually resulted in a net loss for the year of approximately
12.5 million dollars. Proceeds from the sale of the notes were used to
operate IHI, including paying executives.

Court papers alleged that on March 13, 1998, the Securities and Exchange
Commission suspended trading in IHI stock because of its concerns about
VAN ETTEN, the accuracy of statements made to investors,
and the regulatory background of IHI. Three days later, on March 16, 1998,
the SEC filed a civil complaint in the Northern District of Georgia against
IHI, VAN ETTEN, SAVAGE, SMITH, and others, for, among
other things, the sale of unregistered securities, false representations,
and material omissions regarding IHI's financial condition and failing
to disclose that IHI was a pyramid scheme.

The indictment revealed that between March 16, 1998, and on or about
May 5, 1998, VAN ETTEN, BROTHERS, and others attempted
to, and did, mislead the United States District Court in the Northern
District of Georgia regarding the SEC's allegation that IHI had made material
misrepresentations or omitted material facts in the offer or sale of the
convertible notes. Sworn declarations were sought from investors falsely
averring that said investors had been informed that IHI had had losses
for thefirst six months of 1997 of approximately $7.5
million, constituting subornation of perjury.

MAYFLOWER FUND III

It was previously announced that four individuals associated with Mayflower
Venture Capital Fund III were indicted along with STANLEY H. VAN
ETTEN. Mayflower Fund III was a bankrupt venture capital company,
which solicited $15,000,000 from investors to participate in an IPO for
the BuildNet Company. In addition to VAN ETTEN, the indictment
charged BRENT E. WOOD, 42, of Cary, N. C.; TOM D. EILERS, 72, of Cary,
N. C.; and DIANE W. PACE, 42, of Cary, N. C. Tom D. Eilers pled guilty
in February, 2005 to conspiracy; the other defendants are awaiting trial
for conduct associated with the bankrupt Mayflower Venture Capital Fund
III, LLC ("FUND III").

The indictment charged conspiracy, wire and mail fraud, and money laundering
related to the use of approximately $15,000,000 collected by FUND III
from about 120 investors between February, 2000 and November, 2000.

According to the indictment, a series of venture capital companies using
the name "Mayflower" were established between 1996 and 2000 for the purpose
of investing in start-up companies and on-going businesses. All were partially
owned, principally controlled by, or otherwise related to STANLEY
H. VAN ETTEN. FUND III was specifically established to invest
in a planned initial public offering (IPO) by the Durham, N. C., based
company named BuildNet. FUND III was managed by a "Management Committee"
consisting of defendants DIANE W. PACE, TOM D. EILERS, BRENT E. WOOD,
Esq., and others, and had offices in Raleigh, N. C., Dallas, Texas, London,
England, and Zurich, Switzerland.

The indictment sets forth that DIANE W. PACE was an Investment Advisor
and Contact Person; TOM D. EILERS was the Certified Public Accountant;
BRENT E. WOOD was the Lawyer; an unnamed person was an Investment Advisor
and Contact Person; and John Brothers, was an Investment Advisor and Contact
Person.

The indictment further alleges that STANLEY H. VAN ETTEN,
although not a named Fund Manager or member of the Management Committee,
controlled and directed the use of funds, while DIANE W. PACE, M.B.A.,
and TOM D. EILERS, C.P.A., managed bank accounts and fund records. John
Brothers and two other unnamed persons solicited investors and worked
out of the Dallas, Texas, office. BRENT E. WOOD served as legal counsel
for the fund, as well as a member of the Management Committee.

According to the court documents, FUND III obtained approximately $15,000,000
from investors for investment in the BuildNet IPO. Subsequently, the funds
were fraudulently diverted to other unauthorized investments and purposes
without the knowledge or consent of the investors. Overt acts included
a series of "updates" the defendants sent to investors between about May,
2000, and November, 2000, wherein they falsely represented and assured
the investors that FUND III money was exclusively reserved for the BuildNet
IPO. In fact, the FUND III money had already been used for other purposes
without the knowledge or consent of the investors. According to the court
records, the scheme began to unravel when BuildNet withdrew their IPO,
and FUND III was unable to return the investors' money as promised.

TRIALS AND SENTENCING HEARINGS PENDING

As of this date, six former VAN ETTEN associates have
pled guilty to IHI related charges and other matters. A trial date for
remaining defendants has not been set.

Investigations of the IHI, Mayflower, and other VAN ETTEN-
related cases were conducted by the Federal Bureau of Investigation and
the Internal Revenue Service - Criminal Investigation Division, with the
assistance of the Securities and Exchange Commission (SEC), Atlanta, Georgia.
Assistant U. S. Attorneys

J. Gaston B. Williams and Clay C. Wheeler are prosecuting the case for
the United States.

News releases are available on the U. S. Attorney's web page
at www.usdoj.gov/usao/nce within 48
hours of release.

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